Test case for "the office space glut"

For those who did not see the news today, GM will move it’s HQ from the Renaissance Center on the river front, to a newly constructed office tower a few blocks away from the river. The move is scheduled for 2025.

The “RenCen” is the most prominent building on the riverfront: a tall cylinder, surrounded by four square towers, with two smaller towers off to one side. If you think the cylindrical center building looks like the Peachtree Plaza in Atlanta, you are right. Both were designed, in the late 70s, by John Portman, and both hotels are operated by Marriott. GM has had it’s HQ in one of the 39 story square towers for a bit less than 30 years. GM’s move vacates over 600,000sqft in the 400 tower, virtually the entire building. There are varying amounts of vacant space in the other office towers too. The 200 tower is 66% vacant. Overall, 22.3% of Detroit’s class A office space is vacant.

The local news was speculating what will be done with the “behemoth”. renovate it into retail and residential space, or tear the thing down and start over? High rise condos on the riverfront go for stupid money these days. A new apartment building was built where the old hockey arena was torn down a few years ago. Studio apartments in that building start at $2275. One bedrooms start at $2925, while the higher floors, with a better view, ring up $4700/month.

GM bought the complex for $73M. If it goes for residential, I bet they make a tidy profit. The riverfront has changed significantly in the last 20 years: the city has poured millions into creating a linear park along the riverfront, which the RenCen is in the middle of. The area is much more resident friendly than it was when GM bought the RenCen.

Bit of video of the Detroit riverwalk. The RenCen is visible in several shots.

1 Like

@steve203 “This Old House” reported that Detroit is giving away uninhabited houses. How can rents be so high when homes are going for free?

(I’m sure your answer will be some variation of “location, location, location.”)


1 Like

The reference from TOH was referring to a wider problem Detroit faces throughout the entire city. If a city HAD a home density of (say) 2300 homes per square mile 60 years ago and population has now shrunk to (say) 500 occupied homes per square mile, that generates enormous inefficiencies in delivering and maintaining utilities. The “sprawl” is unchanged so the amount of repair work and rework over the miles of piping and wiring is unchanged but those utilities have less than 25% of the income or tax revenue to pay for those fixed expenses. Same goes for police, fire and ambulance coverage.

Many cities facing this problem are trying to encourage higher density in smaller areas by subsidizing redevelopment that encourage people to abandon the fringes and concentrate in more sustainable clusters. It’s an interesting idea but difficult to accomplish. Once the psychological cycle of “decline” is perceived, it’s extremely difficult to counter it, especially if crime issues become predominant.



No doubt the “free” homes require a lot of work to make them habitable. Kind of like the “1 euro” homes in Italy.

I’ve often imagined it would be nice living in a high rise with a view. But then I remember that when I was renting a beach view condo when I lived in Southern California, I didn’t spend a lot of time staring at the ocean. I wasn’t getting a lot of value out of the premium I paid for the view. The other thing that astonished me was that I probably had one of the most scenic, 10 minute commutes in the nation, driving about 6 miles down the Coast Highway between Del Mar and La Jolla in the morning. By the second week, I rarely noticed the ocean, but I did value the short commute since I regard commuting as “uncompensated overtime”.

When I was living in London UK forty years ago it was interesting to observe that almost all the modern high rises were “Council homes” for the poor, and the wealthy seemed to prefer these old drafty historical buildings I wouldn’t consider living in.



I remember that show: a retired Detroit fireman and his family. They bought the house from the Detroit Land Bank. The Land Bank takes over houses that are abandoned or seized for taxes, and offers them to people to rehab and live in them, or tears the houses down, and sells the land for redevelopment.

-first, that was several years ago.

-second, the knock on the redevelopment of Detroit has been all the money is going into downtown, not the neighborhoods. There is still a great deal of poverty and squalor in the city.

Meanwhile, in downtown, developer Dan Gilbert paid out of his own pocket to build a new court and jail complex, outside of downtown, in exchange for the city signing over the downtown land occupied by the current court and jail complex, so he could redevelop it. Gilbert handed over the keys to the new complex a couple months ago. The plan was hatched before the plague however, so I don’t know what his plans are for the land and buildings he now owns. He sold the casino and hotel complex he owned that abutted the old court complex. That is only one project that Gilbert has been involved in.

Before the plague, the narrative was that downtown was “full”. Every possible space had been either rehabbed, or torn down and new built in it’s place. Another of Gilbert’s projects is the new office tower that GM is moving in to. The new building is built on the former site of the Hudson’s department store. Downtown was so full that redevelopment started moving up Woodward into the midtown neighborhood.

Downtown Detroit is probably as nice as you will find in any big, old, city. I hate driving in it, because, first, the city is old, so the streets tend to be narrow, and, second, the guy who laid out the streets had a wheel obsession, so a lot of streets intersect at weird angles.

Here is some drone eye candy of downtown.

Downtown still had some rough edges when Eminem did the Chrysler ad, 13 years ago.

Mayor Dave Bing tried. Some neighborhoods only have one or two occupied houses left on a block, but the street, street lights, water and sewer, all need to be maintained. He tried to get people to move into “sustainable” neighborhoods, and abandon large tracts of land, but people would not move.

Bing was the first elected mayor after Kwame_Kilpatrick went to the slammer for running the city as a “criminal enterprise”. 28 years in the federal pen said the judge. TFG cut his sentence to time served and had the lying sack of slime released.